Online payments company, Paypal has announced that it is no longer in partnership with Facebook’s Libra. This announcement makes Paypal the first company to officially back out of the cryptocurrency’s association.
In a statement, Paypal said that the decision was made in order for the company to focus more on its business and services but said it would continue to support Facebook in the future.
“PayPal has made the decision to forgo further participation in the Libra Association at this time and to continue to focus on advancing our existing mission and business priorities as we strive to democratize access to financial services for underserved populations,
“We remain supportive of Libra’s aspirations and look forward to continued dialogue on ways to work together in the future. Facebook has been a longstanding and valued strategic partner to PayPal, and we will continue to partner with and support Facebook in various capacities,” the statement read.
Facebook’s response: Commenting on the fall out with Paypal, the Libra Association in a statement said that it required a certain boldness and fortitude to take on an endeavour as ambitious as Libra and that commitment to the mission is important and so knowing about this lack of commitment by Paypal is better off now than later.
What this means: For Paypal to walk away from Libra right now even before the project has been launched is a big blow to Facebook and the Libra Association in general. This is even more critical considering the fact that Libra has been struggling under the weight of speculation from regulators and organisations at large.
Regulators and government bodies have been scrutinizing Facebook and its cryptocurrency with concerns over how a Facebook-backed and promoted currency could lead to anti-competitive behaviour.
What you should know: Since Paypal is out, Libra’s list of partners now include Mastercard, Visa, Stripe, eBay, Uber, Lyft, Spotify, Coinbase, Xapo, Andreessen Horowitz, Union Square Ventures, Mercy Corps, and Women’s World Banking, among others.